![]() Insurance is one of the most sober practices of risk assessment. That’s the cost of doing business in the big leagues. Jordan’s was only the very visible example of a bet gone wrong - to the tune of about $60 million. ![]() They won far more many bets than they lost. As it turned out, that insurer wrote many policies that year that landed squarely on the correct side of the ledger. Asked in an interview if they would write that policy again, theirs was an emphatic yes: it was a carefully calculated risk, and it just so happened that lightning did indeed strike in Fenway. (No-one has come up with an exact figure, but I recall it was rumored to be around $1 million.) Second, their insurer ran the numbers very carefully before underwriting that bet. There was much dancing in the streets around Friendly Fenway, and about 30,000 people got free furniture, on top of seeing another duck boat parade.Īnd yet, this was a most incorrect example - first off, Jordan’s Furniture was insured for exactly that scenario (yes, you can insure almost anything!) so their exposure to significant loss was capped. The first year they offered the promotion, 2007, that’s exactly what happened. An easy example could be Jordan’s Furniture, a Boston-area institution for decades, more recently known for offering complete refunds on furniture bought early in the year, if the Red Sox win the World Series. ![]() It has been said by many that humans are lousy at assessing risk, certainly in an informal, heat of the moment setting.
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